In this case, the court severed an adjudicator's decision where he decided an issue that went beyond his jurisdiction. The dispute arose after the works, which were carried out under a JCT SBC 2011, were delayed and the employer Stellite claimed liquidated damages (LDs), referring its claim to adjudication when the contractor Vascroft failed to pay the LDs.
The adjudicator found that time was at large and no LDs were due, prompting Stellite to issue part 8 proceedings for a declaration that the decision was unenforceable because the adjudicator had breached the rules of natural justice. Vascroft had argued that time was at large in its adjudication response, alleging that the contractual machinery had fallen down. Stellite contended that the adjudicator had not fairly canvassed the issue as to whether clause 2.29 permitted an EOT for the events that had caused delay (Issue 1), although he had decided that was the crucial question and formed the view that the delaying events fell outside the scope of clause 2.29. This was considered a breach of natural justice by Stellite. Stellite further contended that the only dispute referred to the adjudicator was whether Vascroft was entitled to an EOT, and thus an additional finding by the adjudicator concerning what was a reasonable date for completion was a breach of natural justice (Issue 2).
Carr J found that Issue 1 was within the adjudicator's jurisdiction, and was canvassed fully by the parties. However she found that the adjudicator had exceeded his jurisdiction in determining Issue 2. It was a 'logical next step' once he had found time was at large to determine a reasonable completion date, and he had material before him to decide the issue, but not the jurisdiction. The parties agreed that, if the judge were to find the adjudicator had exceeded his jurisdiction in deciding Issue 2, then that could be severed from the balance of the decision. Accordingly the judge dismissed the claim for declaratory relief in relation to Issue 1, but granted it in relation to Issue 2.
The decision therefore shows that, where it is practical and possible to do so, a party may be able to sever an adjudicator's decision, allowing the parts that were not controversially decided to stand.
To read more, please click here.